Medimmune Creating Drug Pipeline for AstraZeneca

Nov. 18--When Gail Folena-Wasserman joined Gaithersburg
biotechnology startup MedImmune in 1991, she was its first employee
in research and development, and dreamed of what the company might
be "when it grew up."

Two decades later, the senior vice president for
biopharmaceutical development is helping to test new drugs at a
dramatically different MedImmune. Five years since a $15 billion
acquisition by British pharmaceutical giant AstraZeneca, the
company is funneling a pipeline of potential therapies that has
grown three times over and covers a wider spectrum of diseases.

MedImmune leaders say they are entering a prime phase in drug
development, with several projects moving into final patient trials
and a growing share of AstraZeneca’s overall drug pipeline.
Given intense competition in the industry, success will depend on
how each gamble pays off in the laboratory. AstraZeneca’s
sales and stock prices have taken a hit because of challenges from
generic drug competition, putting the pressure on MedImmune to
quickly turn out new patented innovations.

Despite fears that the AstraZeneca takeover might strip Maryland
of its marquee biotechnology success, MedImmune leaders said the
progress might not have happened without it.

"AstraZeneca made the play for MedImmune, and I have to say this
was a good strategy for the long term," said Bahija Jallal,
MedImmune’s executive vice president for research and
development. "That long term is no longer very long. I think
we’re bringing that to fruition."

Yet the phrase "the next MedImmune" is never far from the lips
of state and regional economic development officials eager to
replicate the company’s success. As the company continues to
grow under AstraZeneca, biotech industry advocates say its presence
still provides a boost to the region.

"They are the model company," said Aris Melissaratos, a former
state economic development official who leads technology-transfer
efforts as a special adviser to Johns Hopkins University President
Ron Daniels. "It’s a huge success case study."

The company, founded in 1988, built its reputation on Synagis,
used to prevent an infant lung disease known as respiratory
syncytial virus, and FluMist, a nasal-spray flu vaccine. MedImmune
also contributed to successful drug products including Humira and
Gardasil.

By the time AstraZeneca came courting, MedImmune had built up a
23-acre Gaithersburg campus, employed 2,500 people and stood to add
$1 billion to AstraZeneca’s sales. Once the deal closed,
AstraZeneca melded another recent acquisition, British firm
Cambridge Antibody Technology, into MedImmune with the charge of
building a pipeline of medicines based in biology, as opposed to
being chemically created.

At the time, MedImmune’s roster of about 40 projects
represented less than 25 percent of what AstraZeneca researchers
were exploring, Jallal told reporters at a recent open house for
news media. Today, MedImmune researchers are testing about 120
potential or proven therapies, 45 percent of AstraZeneca’s
drug pipeline.

"We’re not going to stop at 45 percent," Jallal said.

Before the acquisition, MedImmune’s most acclaimed
research was in the fields of infectious and respiratory diseases,
with some exploration into cancer drugs. But in the past five years
its focus has expanded to include neurological, cardiovascular and
gastrointestinal diseases, Jallal said.

Among the ailments that could one day be treated by drugs
MedImmune is exploring are drug-resistant bacterial infections,
leukemia, asthma, lupus and diabetes. Steve Projan, who heads the
company’s research into infectious diseases and vaccines,
said he expects to file plans with the FDA by the end of the year
to start clinical trials on a drug to fight the sometimes deadly
Staphylococcus aureus bacteria, a form of which is better known as
MRSA.

Juggling the deeper stable of projects has required some
adjustments, Folena-Wasserman said.

"Our science has certainly matured a lot because of the size of
the organization," she said. (There are about 1,000 more employees
than five years ago.) "One of the most difficult aspects was, how
do you go from a small portfolio where you know absolutely
everything about every project to -- which of 35 projects am I
thinking about now?"

There has been a need to trim projects with a lower probability
of succeeding, Jallal said. And officials recognized that the
current pipeline, which is updated twice a year to the public, is
heavy on relatively early-stage projects. A significant number are
in Phase 1 and 2 clinical trials, being tested on small groups of
patients, but none are in Phase 3 trials, when drugs are fine-tuned
on larger populations. In January, a few will shift into the Phase
3 column, Jallal said.

The longer that process takes, the less profit it could mean for
AstraZeneca, said Jim Pyke, a principal with Chicago-based
consulting firm Bridge Strategy Group LLC. That’s in part
because drug companies have, at most, a 20-year window to hold a
patent on a medicine, and several years to exclusively market the
drug without competition from generic versions. But those periods
can begin well before a drug goes to market, Pyke said.

Generic drug competition has hindered AstraZeneca’s
performance, as sales and profits have declined by nearly 20
percent through the first nine months of the year. The
company’s stock price has fallen 3 percent on the New York
Stock Exchange and 5 percent on the London Stock Exchange this
year, even as rivals Merck, Sanofi and Eli Lilly & Co. have
posted significant gains.

Still, local biotech industry advocates have been pleased with
MedImmune’s performance. Although many feared job cuts when
news of the acquisition broke, the opposite has occurred, said Judy
Costello, deputy director of the Maryland Biotechnology Center. A
recent scan of the company’s online job board showed nearly
90 open positions across the company.

Company officials are also taking time to invest -- both
literally and figuratively -- in startup biotechs striving to
follow in MedImmune’s footsteps.

CEO Peter Greenleaf, also chairman of the Maryland Venture Fund
Authority, which is working to invest $84 million in state and
private money in local technology companies, frequently lends his
thoughts to business leaders at networking events, Costello said.
Greenleaf joined the company just before the acquisition, helping
to lead its marketing and corporate strategy before becoming CEO in
2010.

MedImmune Ventures, the company’s investment arm, has $400
million under management that it has used to back startups,
including Towson-based Corridor Pharmaceuticals.

MedImmune officials said the growth and reinvestment
wouldn’t be happening without AstraZeneca’s resources.
Jallal credited the acquisition for beefing up the research that is
driving it all.

"We could not have done this," he said, "with the MedImmune that
we were."